Compared to their white and Black peers, Latinos have a longer life expectancy. However, this fast-growing segment of the population isn’t necessarily financially prepared to make the most of their tercera edad. Four out of five Latino households have less than $10,000 in retirement savings, according to a 2013 National Institute on Retirement Security report. Because of this retirement crisis, Grand, a new start-up, aims to give Latinos the knowledge, tools, and access to “rewrite the script” and improve their financial life on their own.
The idea behind Grand is to organically change the mindset Americans have toward finances from intimidation and negativity to positivity and reward. Once a customer has balances saved they can begin investing with one click. Users have the capability to build an emergency fund, invest for retirement, or a personal goal such as a wedding, a home or a new addition to the family.
Staff offers real-time recommendations for ways users can save money and improve their financial lives. This includes credit monitoring, life insurance and personal loans.
“Most people don’t have super personalized access or feel comfortable using financial services,” says co-founder and Filipina-American Nicole Reyes. “We aim to make this tool easy and comfortable to use regardless of their financial expertise.”
While the tool is geared toward the average American, communities of color, such as young Latinos, are of interest to the founders. It’s important to note that Latinos are often at a disadvantage when it comes to finances. The median white person has earned $2 million by the time they turn 61, meaning they’re able to save more than African Americans and Latinos who earn $1.5 million and $1 million, respectively.
Reyes explains that Latinos already have a great savings mindset but need to understand the value of investing and planning ahead if they want to make the most of their dollars.
“What’s happened is Latinos have money saved but have not saved for retirement at the same rates as other groups,” Reyes says. “We hope to help shift that savings mentality to both a savings and investment mentality or savings and planning mentality.”
She has seen the negative impact a lack of knowledge and planning can have on the financial future of loved ones. Her mother-in-law, for example, spent her money on the lottery instead of growing her retirement account. Reyes knows many people with similar experiences and wants to change the narrative.
“It’s not that people aren’t capable; it’s that they don’t know what they don’t know,” Reyes says. “When it comes to creating capitol within a community, slowly over time, this technology can be really impactful.”
A unique feature of Grand is that it incentivizes saving and investing for customers. Grand gives away cash to encourage people to save. Customers have a shot at winning cash with every dollar they save.
Users can open up a Jackpot Savings account at https://grand.co with $1. Customers connect their existing bank account so that money can be transferred back and forth easily, automatically, and at any time.
The founders are actively exploring ways to reach audiences that can most benefit from the Grand tool. To attract young Latino populations, for example, they’ve contacted Latinx media companies, who the company hopes to collaborate with.
She advises Latinos to start productively planning for a sound financial future early. “Even if it’s only a few bucks a month or a week. The most important thing is consistency,” she says.
Set up an emergency fund and investing what you can will help get the ball rolling. “Set some goals and envision the life you want to live,” Reyes says. “That makes it a lot easier to start planning for those things.”